One Seneca Tower and its linked five-story parking ramp across the street are once again in the hands of a single owner, after the company that represents the mortgage holders on the two structures took ownership of the ramp Thursday in the foreclosure auction.
The sale marks the start of a new chapter for the tower and ramp, which are connected via a pedestrian footbridge over Washington Street. Built in 1972 and almost completely occupied for most of its history, they had both been owned by Seneca One Realty of New York City since 2005.
LNR Partners, a loan servicer representing investors, had taken ownership of the 38-story tower in October, and it got the parking ramp Thursday.
However, the change didn’t come without a display of fireworks, before about 30 people gathered in the tower’s auditorium.
What most people expected would be a sleepy public sale of the 814-space parking facility turned into a three-way bidding war, as local developer Mark Croce and New York City businessman Harvey Kaylie unsuccessfully vied for ownership with LNR Partners.
To no one’s surprise, LNR won, with a price of $7.7 million. But it had to raise its offer more than three times its opening salvo to get there, as Croce and a representative for Kaylie kept raising the bar.
“I think that’s probably about the right amount,” said Tim Palmer, an attorney with Buchanan Ingersoll & Rooney PC, who handled the bidding on behalf of LNR. “I don’t think we had any idea.”
Most real estate experts and observers had expected that LNR would emerge as the winner of the ramp in the end, although it doesn’t actually pay any money. As special servicer for a pair of loans on the tower and the ramp, the firm represents the Wall Street investors holding the mortgage that was in default. So it could keep raising the bid up to the value of the debt, unless it chose to accept a lower price. And it needed to gain ownership of the ramp, in addition to the tower, in order to sell them together as a package to recoup as much of the investors’ loan losses as possible.
LNR now has one month to close the deal by April 4, at which time it will reunite the ramp and the 853,000-square-foot tower. The servicing company is then widely expected to seek a buyer for the entire package, though its specific plans and timeframe are not known.
The company already issued a first “call for offers” on the tower last month through commercial real estate agents at Pyramid Brokerage Co. of Buffalo and its national affiliate, Cushman & Wakefield. No serious offers had come in as of Feb. 22, but officials have declined to comment since then.